Georgia’s Long Argument with Geography

In Tbilisi, Europe is the aspiration, Russia the inescapable neighbour — and Gulf money is becoming the most conspicuous new arrival

A short walk through Tbilisi produces a succession of contradictory impressions.

The Georgian capital looks westward with almost determination. English dominates the shopfronts, restaurant menus and hotel receptions of the city centre. European Union flags appear on public buildings and balconies. Young service workers tend to address foreign visitors in English.

Yet one Russian word remains unusually visible: аренда, or “for rent”. It appears beside its English equivalent in apartment windows and property advertisements, a small but revealing indication of who landlords believe may possess money, mobility and an immediate need for accommodation. Since Russia’s full-scale invasion of Ukraine in February 2022, Georgia has absorbed waves of Russian, Ukrainian and Belarusian arrivals. Many of those came to avoid mobilisation, political repression or economic isolation; others brought remote jobs, savings and businesses.

The influx was economically significant. Georgian border data recorded almost 870,000 entries by only Russian citizens during 2022, although more than 809,000 departures meant the number settling permanently was far smaller. Estimates vary because Russians may enter Georgia without a visa and remain for up to a year, but the net inflow was still large enough to transform parts of Tbilisi’s rental market.

For Georgia, a country of roughly 3.9 mn people, even tens of thousands of relatively affluent newcomers constituted a substantial demand shock. The result was familiar to residents of Amsterdam, Lisbon and other cities reshaped by mobile capital: rents rose faster than local salaries, apartments became investment assets and younger citizens found themselves competing with foreigners earning foreign incomes.

The resentment this created is easy to encounter. “Because of the Russians, all the prices have gone up,” one young Georgian told me. The complaint is not necessarily a political theory. It is a description of household economics.

The expats also complicated Georgia’s already fraught relationship with the Russian language. Russian is no longer the default lingua franca that it was in the 20^th century, especially among younger Georgians. The 2024 census recorded about 54,500 people reporting Russian as their mother tongue – roughly 1.4 per cent of the enumerated population – up from the previous census but still a small minority. Ethnic Russians accounted for only 0.7 per cent of the population in the 2014 census. These figures, however, do not measure the much larger number of Georgians who understand Russian as a second language.

In Tbilisi’s cafés, linguistic choices can therefore carry political weight. Two young women working in the hospitality sector told me, somewhat reluctantly, that they understood Russian but did not speak it confidently. Both were fluent in English. Yet when one brought the bill, she called it a schyot, the Russian word for an account.

Such moments should not be overinterpreted. But they reflect a generational transition. English is the language of aspiration, education and international employment. Russian is associated with family memory, practical communication and an imperial history that many Georgians would prefer not to inherit.

A city draped in other nations’ flags

Georgia’s national identity is not difficult to find, but its contemporary political symbolism is often expressed through the flags of others.

Ukrainian and EU banners are conspicuous across central Tbilisi. Since the 2008 war, in which Russian forces entered Georgia and Moscow subsequently recognised the breakaway territories of Abkhazia and South Ossetia, Russia has represented not merely historical domination but a current security threat.

The war in Ukraine intensified that perception. In much of Georgian public life, Russia is not an abstract former imperial power. It is the state whose troops remain stationed in territories internationally recognised as part of Georgia.

This history helps explain the structure of the Georgian National Museum’s Soviet occupation exhibition. The narrative moves from medieval statehood and royal figures such as David IV and Queen Tamar towards annexation, Soviet repression and lost sovereignty. Like most national museums, it does not simply catalogue the past; it constructs a usable national story.

But museum narratives can mislead through compression as well as through error. Georgia suffered enormously during the second world war. Several hundred thousand people from Soviet Georgia served in the Red Army and estimates of Georgian military deaths commonly run into the hundreds of thousands. To attribute all those deaths simply to “Soviet occupation”, however, risks collapsing two distinct arguments: that Soviet rule was coercive, and that Georgians died fighting Nazi Germany as citizens of the Soviet Union.

It may also leave visitors with the mistaken impression that an independent Georgia could easily have remained outside the conflict. In reality, the Caucasus was strategically central to Hitler’s campaign because of its oil, transport routes and geography. The more defensible criticism is therefore not that the museum’s anti-Soviet interpretation is illegitimate. Georgia was forcibly incorporated into the Soviet system, and Stalinist repression was extensive. It is that national memory becomes less persuasive when it substitutes moral simplicity for historical complexity.

The invisible Europeans and the visible Gulf

The same tension between appearance and substance is present in Georgia’s economy.

At street level, westernisation is most visible through brands: English signage, European fashions and international coffee chains. Yet the largest new physical projects increasingly carry Gulf names. Carrefour, operated regionally by Dubai-based Majid Al Futtaim, is prominent. Gulf-backed hotels, residential developments and mixed-use projects are difficult to miss[1].

The most striking example is Eagle Hills. In 2025, the company and the Georgian government announced planned developments in Tbilisi and Gonio valued at more than $6bn, subsequently described by Eagle Hills as a $6.5bn programme. If implemented in full, it would be enormous relative to Georgia’s economy and far larger than the country’s annual inflow of foreign direct investment, which was about $1.68bn in 2025.

But announced investment is not the same as invested capital. Masterplans can take years to execute, be scaled down or fail altogether. Comparing a headline Gulf property commitment with historical European investment would therefore be misleading.

The EU’s financial presence is less photogenic but broader. EU member states collectively invested about $5.9bn in Georgia between 2006 and 2019, representing more than 30% of net foreign direct investment over that period. By September 2024, the EU said its Global Gateway programme had mobilised €2.1bn in public and private investment for Georgia. The European Bank for Reconstruction and Development alone had invested more than €5bn in the country by 2024, approximately half of it in the private sector.

The EU is also Georgia’s largest trading partner. Bilateral goods trade reached approximately €5.2bn in 2025, including €4.3bn of EU exports to Georgia and about €900mn of imports from Georgia. Europe’s influence, in other words, is embedded in banks, roads, trade rules, technical assistance and regulatory reform. Gulf money is concentrated and architecturally visible.

Europe as destination rather than project

For many young Georgians, Europe is not merely a geopolitical alignment. It is a personal exit strategy.

Germany has particular appeal because of its universities, vocational programmes and relatively structured routes from education to employment. Reliable, current statistics for the exact number of Georgian nationals studying in Germany are fragmented across German university, mobility and scholarship datasets, and scholarship recipients represent only a fraction of the total.

The social reality is nevertheless evident. German is widely studied not only out of admiration for German culture, but because it is perceived as a practical instrument: first a university place, then employment, residence and possibly citizenship.

This creates a paradox. Georgia’s European orientation is intended to modernise the country and improve opportunities. But the more convincingly Europe advertises its universities, salaries and institutions, the more Georgia risks educating its young people for departure.

The problem is not that Georgians wish to study abroad. International education can strengthen a country when graduates return with skills, capital and networks. The problem arises when the dominant assumption is that success means leaving permanently.

Georgia received EU candidate status in December 2023, but its accession process came to a de facto halt in 2024 with Georgian government’s decision to suspend pursuit of accession negotiations until 2028.

This is not simply an EU failure. The deterioration reflects choices made by Georgia’s own political leadership. Nor is it proof that the country must return to Russia’s orbit.

Post Georgian tractate

Russia’s record in Georgia illustrates the limits of power without attraction.

The Russian empire and Soviet Union left behind railways, administrative systems, schools, industrial facilities and a shared cultural vocabulary. They also left annexation, political repression, forced centralisation and unresolved territorial conflict. Infrastructure and coercion were not competing interpretations of the same history; they coexisted.

Moscow nevertheless failed to preserve a durable sense of common ownership over that history. Russian influence in Georgia is now sustained primarily by geography, trade, migration and military power, not by admiration for Russian institutions.

This is a strategic failure. Successful centres of influence make neighbouring societies want access to their universities, labour markets, technologies and legal systems. Europe’s greatest power in Georgia has been precisely this capacity to attract.

The comparison with western colonialism should be handled carefully. The continued use of French in parts of Africa does not demonstrate that Belgian or French colonial rule was more benign or more successful. Colonial languages persist for many reasons, including education systems, administration, regional communication and the absence of a politically neutral alternative.

Nor does the decline of Russian among young Georgians prove that the countries no longer share cultural connections. It shows that language follows incentives. Where Russian once offered access to a vast common labour and educational market, English and German now promise greater mobility and higher incomes.

If Russia wanted to recover influence in its neighbourhood, military pressure would be the least effective route. The more durable strategy would be to build a prosperous, lawful and scientifically productive economy that neighbours found attractive.

Geography without submission

Europe is imagined as the future. Russia remains the unresolved past and unavoidable neighbour. Gulf capital is buying a prominent stake in the physical present. Meanwhile, many of the country’s most ambitious young people are learning the languages that may enable them to leave.

Georgia’s challenge is to resist defining itself exclusively as the opposite of Russia. An identity built solely around rejection remains dependent on the object it rejects. The more productive question is what Georgia intends to become on its own terms.

[1] Jim Stenman speaks extensively about the Gulf capital dynamic in Goergia in his Substack - Starbucks enters Georgia, deploying Gulf playbook as conduit for Western brands